AIB set to pay €1.76bn back to the State

As it releases its first-half financial results tomorrow...

AIB set to pay €1.76bn back to the State

Photocall file photo

AIB will redeem €1.76bn in loan notes tomorrow, as the bank continues to reimburse the taxpayer for its €20.8bn bailout five years ago.

The repayment will see the bank hand over €1.6bn to redeem contingent capital notes (CoCos) at face value, and a further €160m in accrued interest.

The Irish Times has reported on the planned payment, which coincides with the release of its financial results for the first six months of this year.

According to the paper, Goodbody banking analyst Éamonn Hughes expects AIB to announce a net profit of €623m on Thursday.

The bank is also expected to reiterate previous guidance that the timing of a stock market flotation is a matter for the Government but that it is prepared to move once a decision has been made.

The Government had signalled its intention last year to float 25% of AIB’s shares on the stock markets in Dublin and London in 2016. It has been postponed thus far due to extreme market volatility.